Every year thousands of people start a business. With more
people stuck in dead end jobs and working for sub-standard
pay, it always seems like the next logical step. They strike
out with dreams of becoming financially independent, being
paid what they’re worth, or being able to work their own
hours. The sad news, according to numerous government and
independent resources, the odds are stacked against these
budding entrepreneurs. In reality, the odds are stacked in
favor of failure as most new business start-ups fail in
three years, and many more fail before their second year.
What are the problems new entrepreneurs face that cause such
catastrophic results?
Biggest Reason for Business Failures – Failure to
Plan.
The biggest problem seems to be lack of planning. New
business owners fail to complete business or marketing
plans. They get so fed up with present jobs, or life styles,
they jump into self-employment ventures. They fail
investigating local competition or the potential customer
market and start business ventures destined for failure.
They open shops and go out of business before their second
year. Had they taken some time in research, they may have
found the local market was too saturated or local business
was already struggling to stay operational. They may have
found certain barriers to entering their market that would
prevent them finding business success. However, they failed
to do that research, and many didn’t formulate business or
marketing plans. They lacked a road map taking them to their
goals, and combined with the other reasons mentioned, is why
they failed. Without clear plans identifying individual
steps to success, how can you become successful? Sadly, most
all business failures failed to create road maps.
A business plan is critical if you want government funding
or a bank loan, but it’s just as critical if you don’t need
them. The business plan is a report on research into your
chosen business field. By completing it, you find out about
your local market, competition and potential customers, if
your industry is growing or declining, and a host of other
information needed to formulate plans for business success.
While the business plan tells if it is a wise to open your
business, a marketing plan reminds you how to make sales.
The marketing plan lists step-by-step instructio
